Credit union memberships are up one year after Bank Transfer Day

Today marks the one-year anniversary of Bank Transfer Day (BTD), which came on the heels of the Occupy Wall Street movement and growing frustration with increasing bank fees. As it encouraged people to switch from banks to credit unions, the momentum leading up to BTD generated lots of media attention and the day ended up with 664,000 people new credit union members nation-wide. The renewed interest in credit unions was a hopeful moment for the credit union industry– and for community-based financial service providers overall. Now that it’s been a year, it is important to ask if BTD had a long-term impact.

As the Credit Union Times reports, as of the end of September, “56% of credit unions said members’ growth in the past year has exceeded expectations, and 55% of credit unions said accounts have been increasing among new members, according to a survey by NAFCU.” Bill Cheney of the Credit Union National Association writes that the year ending in June 2012 saw 2.2 million new members:

To give you a sense of perspective, that is almost double the 1.2 million average growth we’ve seen in similar 12-month periods over the past 10 years, and it is four times greater than the 550,000 total of new credit union members who joined over that same period the prior year.

It is encouraging to see that the interest in alternative financial services has been sustained, and that Bank Transfer Day spurred a movement that did not fizzle after the media attention dissipated. Moving forward, credit unions and other community base financial service providers should work to keep this movement going. Some credit unions are celebrating BTD again this year, while others are pushing for a “Every Day is Bank Transfer Day” campaign.

Discontent with mainstream banks is still very real and prevalent among those with access to traditional financial services, while many others remain unbanked and disconnected from any financial services at all. Credit unions and others have long been stepping in to fill this gap in services, but by stepping up our efforts now we can raise the profile of alternative financial service providers, and eventually help to reach more people seeking affordable services. After all, this is ultimately the goal. As Bill Cheney states, every account– no matter how small– is a step toward increased financial security:

I’ve seen comments from some banking executives who are dismissive of the Bank Transfer Day phenomenon, saying they don’t really care because these small-dollar accounts that have moved aren’t profitable. That is being short sighted. Even a low-dollar checking account can be a first step to a deeper relationship with a financial institution. But credit unions, as not-for-profits, are also not as concerned as banks about making money on every account.